Reference no: EM132292104

A substantial drop in attendance figures forced the NBL to review its marketing strategies in a bid to generate more excitement and momentum in the early part of the 1993 season. After ten rounds, the NBL—which trumpeted a sensational growth in attendances throughout the 1980s and early 1990s—was down by almost 270 000 fans (Brown 1993: The ten-team NBL competition commenced in 1979 as an outlet to provide a regular opportunity for its elite players to play top-line basketball. It also quickly became the promotional vehicle for basketball in Australia. The gate for the first season was 196 000 for all home and away games. By 1995, as is shown in Table 5.3, attendances had risen to 1 097 678 from 201 games played across the country. An average of 5461 fans attended games in 1995. From 1979 to 1984 attendances grew 82 per cent, to 355 828 spectators, but in the five years to 1988 they jumped 130 per cent, clearly demonstrating the sport’s appeal, and in the five years to 1993 they rose to just over 1 million. Seasons 1993–95 show that growth then slowed and that the NBL in terms of attendances had plateaued. The success of the NBL in capturing the public’s imagination in the 1980s can be traced to several reasons. It was a highly entertaining game, played in a comfortable, warm stadium, enjoyed by men and women, and revered by children. Hype generated by the NBL was also fostered by enormous goodwill from the print media and radio media. There was no question that this most American of sports had taken off in Australia, but to continue to grow it needed television to play a more significant role (Brown 1992). The Seven Network, which held the rights to televise basketball in Sydney and Melbourne prior to 1992, was reluctant to give basketball a greater profile. Channel Ten took up the rights to televise the NBL in 1992 on the promise that the NBL would be shown in prime time. As the 1992 season unfolded, the Ten Network realised that NBL programming was suffering from low ratings. The only exception to this was Perth. Following the break for the 1992 Olympic Games, the Ten Network removed the NBL from prime-time television. Television remains a source of frustration for the NBL. In 1995, the NBL made the following observations in relation to television and its impact on product development:

With television we found ourselves in a difficult situation. In order to make television work, the NBL will have to become much more flexible in its scheduling (playing in non-competitive days and times), consider changing the time of year we play, clean up the court clutter (to increase NBL branding and strengthen television advertising). All of these strategies may have a cost to the clubs. This cost will not be initially met by television rights revenue. But without making some or all of these changes, television rights revenue may never reach the level to be able to finance the changes. Almost every aspect of the NBL/Club business now comes back to creating success on television. Marketing, merchandising, attendance, rights money and sponsorship levels all point to television needing improving. The television ratings are a mystery. Our worst rating performance in recent history comes at a time when a new ARM Quantum survey shows that basketball has increased its stranglehold on the youth in this country. Basketball ranks as the top sport played by boys (10–17) at 59%, 12 points above the next team sport, cricket (47%). For girls, basketball ranks third at 31%, behind swimming (52%) and netball (36%). There are more mysteries in the result of the survey that indicates what the youth market are watching on television. Basketball is way out in front at 50%, ahead of cricket at 38%—significantly improving its position since the last youth monitor three years ago. Finally, in the 10–17-year group, basketball is the best attended sport at 22%, ahead of rugby league at 17%. (NBL 1995)

In 1996, the NBL made the decision to move the NBL season from its traditional winter season to a summer season. This necessitated a transition, or interim season, from January to July 1998. The new summer season commenced in October 1998. The rationale for the change, according to the NBL (2000), was: (a) to improve television arrangements; (b) increase media coverage through reduced clutter (i.e. less AFL media); and (c) maintenance of sponsorship, although it was recognised that reduced attendance might result from the change. Although the interim season had a negative impact in terms of club mergers and further erosion of the fan supporter base, television coverage improved—albeit mainly through pay TV channel Fox Sports supported by ABC coverage. Attendances grew 8 per cent in the first full summer season, compared with a 5 per cent decline in the interim season. The second summer season allowed the NBL to experiment with innovative fixturing, such as the pre-season blitz, double-headers, an open-air game at Rod Laver Arena, Melbourne Park, as well as promoting local derbies. Attendances also rose by approximately 14 per cent, with average weekly television audiences of about 580 000. By the 2002 season, however, the NBL and its teams were experiencing difficulties. Dampney (2002: 101) notes that ‘two clubs appointed administrators, no naming rights sponsor, no free-to-air television rights—no national basketball League?’ Both the Victorian Titans and Sydney Kings appointed administrators in 2002, although a consortium—including former Australian Boomer Shane Heal and Bob Turner, a founding member of the NBL in Australia— eventually bought the Sydney Kings. The Victorian Titans’ future was less certain mid-2002. Leading into the 2002–03 season, the eleven teams in the NBL competition were facing a series of collective challenges.

The rebirth of Australian basketball features a returning 35-year-old legend, small crowds, tight budgets and a team—or possibly two—based more than 6000 kilometres from Sydney. It sounds like a peculiar recipe for success, but in the post-boom period of the National Basketball League, it may be a necessary reality. Low television revenues, a lack of big names (or an inability to effectively market them), competition from other sports and a failure to capitalise on gains made previously, has changed the NBL, whose preparation for 2006–07 has included the unprecedented addition of a Singapore-based club and another Melbourne team, the South Dragons, whose big signing is the onceretired Shane Heal. It has also been marked by the demise of yet another club, the Hunter Pirates. (Sygall, 2006)

As Sygall notes, the NBL has been struggling to find the right formula to relaunch basketball. In 2004 the NBL secured Philips as its major sponsor and Fox Sports as its broadcaster, which stemmed the tide to some extent. On the eve of the 30th NBL season in 2007/08, the NBL competition had grown to thirteen teams, two of which were based outside Australia. In 2003–04, the New Zealand Breakers were the first non-Australian-based team to enter the competition, followed by the Singapore Slingers in 2006–07. The long-term goal is to have two teams located in Asia, with television revenues an obvious lure. Meanwhile, the 2007–08 season commences with the addition of a thirteenth team, the Gold Coast Blazers, and the NBL having lost its sponsor. The Philips sponsorship was estimated to be worth in excess of $1 million per year and its loss is an obvious blow to the NBL. However, on the eve of the new season, the NBL announced HUMMER, a division of General Motors, as its naming rights sponsor. One of the world’s fastest growing truck brands, the mid-size H3 SUV HUMMER, was launched in Australia in 2007. In relation to television, the Fox Sports broadcasting deal is due to expire at the end of the 2007–08 season. As Dampney queried in 2002: ‘Is all hope lost for a game once labeled the world’s fastest growing participation sport?’ The NBL’s woes continued in the lead up to the 2008/09 season with both the Sydney Kings and Singapore Slingers withdrawing from the competition. Product development is again a major issue confronting the NBL.

Questions:

1. Identify the reasons for the decline in demand for the NBL?

2. How is the NBL a good example of the theory of the product life cycle?

3. In product life cycle terms, at what stage would you place the NBL?

4. What were the competitive positioning implications of moving the NBL season out of the winter to a summer season? Has it been successful?

5. Describe the product positioning of the NBL. Using your research skills, identify potential sports and allied products that might occupy a similar product space on a perceptual map. What competitive threats do these sports represent?